Industry Deep Dive: Core Banking Modernization for Specialist Lenders and Niche Financial Institutions

Unlocking Growth and Customer Value Through Composable, Cloud-Native Platforms

While the spotlight often shines on large retail banks, specialist lenders, credit unions, and niche financial institutions are quietly driving innovation in the financial services sector. These organizations face unique challenges: legacy IT systems, complex regulatory requirements, and the need to deliver highly personalized experiences to distinct customer segments. Yet, they also have a tremendous opportunity to leapfrog traditional barriers by embracing modern, composable, cloud-native core banking platforms like Mambu.

The Imperative for Change

Specialist lenders and niche institutions often operate in highly regulated, high-touch environments. Legacy core systems, while reliable, are increasingly unable to keep pace with evolving customer expectations, regulatory demands, and the need for rapid product innovation. Maintaining these systems is costly and time-consuming, diverting resources from growth initiatives. As digital-native competitors and fintechs raise the bar for customer experience, the pressure to modernize has never been greater.

Composable, Cloud-Native Platforms: A Game Changer

Platforms like Mambu are redefining what’s possible for specialist lenders and non-traditional financial institutions. As a true SaaS cloud banking platform, Mambu enables organizations to assemble independent components, systems, and connectors in any configuration—creating a composable architecture that adapts to business needs and customer demands. This flexibility is especially valuable for institutions with specialized product offerings or unique regulatory requirements.

By leveraging cloud-native, API-first platforms, these organizations can:

Real-World Transformation: The OSB Group Story

OneSavings Bank (OSB) Group, the UK’s leading specialist lender, exemplifies the power of core banking modernization. Facing outdated IT and rising customer expectations, OSB Group partnered with Publicis Sapient to build a greenfield, cloud-native core banking platform. The solution, powered by Mambu and a suite of fintech tools, was designed for scalability, agility, and customer-centricity.

Within 12 months, OSB Group launched a new savings platform, achieving:

This transformation not only boosted deposits and operational efficiency but also established a robust foundation for future growth and innovation. The partnership between OSB Group and Publicis Sapient was built on shared goals, agile methodologies, and a culture of collaboration—demonstrating what’s possible when technology and business strategy align.

Best Practices for Successful Modernization

Modernizing the core is a complex journey, but specialist lenders and niche institutions can maximize their chances of success by following proven best practices:

  1. Translate Ambition into Action: Start with a clear vision for the future. Define the customer problems you want to solve, the experiences you want to deliver, and the business outcomes you seek. Build a transformation plan that is actionable and aligned with your unique value proposition.
  2. Adopt a Composable, Modular Approach: Avoid monolithic solutions. Instead, leverage composable platforms that allow you to assemble best-in-class components tailored to your needs. This approach reduces risk, accelerates time-to-market, and enables ongoing innovation.
  3. Prioritize Customer-Centricity: Place the customer at the heart of your transformation. Use real-time data and analytics to personalize experiences, empower self-service, and deliver seamless journeys across channels.
  4. Embrace Agile Delivery and Collaboration: Form multidisciplinary teams that bring together technology, business, and customer experience experts. Work in agile sprints to iterate quickly, test new ideas, and adapt to changing requirements.
  5. Mitigate Risk Through Coexistence: Rather than a “big bang” migration, consider a coexistence strategy—running new and legacy systems in parallel to minimize disruption and ensure business continuity.
  6. Secure Buy-In Across the Organization: Core modernization is not just a technology project—it’s a business transformation. Engage stakeholders at all levels, from leadership to front-line staff, to build momentum and ensure lasting change.

The Power of Partnership

No single technology can address the full spectrum of needs in financial services. That’s why Publicis Sapient brings together a curated ecosystem of partners—including Mambu, Salesforce, nCino, and leading cloud providers—to deliver tailored, future-ready solutions. Our approach combines strategy, customer experience, engineering, data, and product management to help specialist lenders and niche institutions:

Looking Ahead: The Future of Specialist Lending

As the financial services landscape continues to evolve, specialist lenders and niche institutions have a unique opportunity to lead the way in customer-centric innovation. By embracing composable, cloud-native core banking platforms and proven modernization strategies, these organizations can deliver the experiences their customers expect—faster, more securely, and at lower cost.

Ready to start your core modernization journey? Publicis Sapient’s expertise and ecosystem of partners can help you build a future-ready bank that stands out in a crowded market—delivering value for your customers and your business alike.